Posted 17th Mart 2023

Gold Price News: Banking Crisis Sees Gold’s Haven Appeal Come to the Fore

gold bullion markets price

Gold continues to benefit from concerns over the health of the US banking sector with the price surging comfortably above $1,900 an ounce to be trading at around $1,930.

Overall, gold has gained more than $100 an ounce since March 7th and is closing on its highest level for the year so far.

The latest news on the big US banks teaming up to shore up First Republic Bank with $30 billion in deposits of their own money has highlighted that fears over contagion are well-placed after the collapse of first Silvergate, then Silicon Valley Bank and Signature.

With the banking sector looking shaky, investors have turned to the ultimate haven asset that has survived through centuries of conflict and stock market crashes – with gold’s lack of counterparty risk particularly attractive at times such as these.

It is worth noting that the European Central Bank still increased its benchmark rate by 50 basis points (as was originally expected) and didn’t choose to alter its approach despite the troubles Credit Suisse is facing – reminding investors that this isn’t a uniquely American problem.

As such, this increases the likelihood of the Federal Reserve also sticking to its plan of another hike when it meets next week so with rates continuing to rise that is likely to put a cap on how gold can climb.


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